Business Interruption Insurance can help protect the financial position of a business when its operations are interrupted following an insured event.

It commonly operates where insured physical damage, such as fire or storm damage, disrupts the business.

Some policies can also include additional extensions, subject to the wording.

What can Business Interruption cover? #

Depending on how the policy is arranged, it can include:

• Loss of gross profit
• Loss of revenue or turnover
• Weekly income
• Continuing business expenses
• Wages where insured
• Additional costs incurred to continue trading
• Temporary premises or equipment
• Claim preparation costs where included

Business Interruption Insurance does not generally respond simply because a business experiences lower revenue or cannot trade.

A relevant insured event or applicable extension normally needs to trigger the cover.

What is the indemnity period? #

The indemnity period is the maximum period for which the Business Interruption section can respond following an insured event, subject to the policy terms.

It should allow enough time for matters such as:

• Repairs or rebuilding
• Replacing equipment
• Re-establishing operations
• Recovering customers and revenue
• Returning to the expected trading position

The sum insured, basis of settlement and indemnity period can materially affect the amount available following a loss.

Contact our team if you would like help reviewing how Business Interruption cover has been arranged.